Consistent with existing evidence based on US firms, we show that good governance is associated with higher credit ratings. The most significant variables are institutional ownership and disclosure quality. This finding suggests that active monitoring (by large shareholders) and lower...

Purpose The purpose of this paper is to investigate whether higher asset risk can be associated with higher leverage and to provide a rationale for the relatively low debt ratios displayed by many firms. Design/methodology/approach A game is modeled between an informed firm and uninformed...